NuCypher ICO Review And NKMS Token Analysis

NuCypher ICO Overview

The NuCypher ICO and NKMS Token offer a decentralized key management system (KMS), encryption, and access control service to address the inadequacies of current data encryption mechanisms. The service enables private data sharing between any number of participants via public consensus networks, using proxy re-encryption (PRE) to delegate decryption rights in a way that cannot be achieved by traditional public-key encryption techniques.

NuCypher leverages a network of nodes that provide re-encryption services. NKMS tokens are used to incentivize network participants as they manage keys and delegation/revocation operations.

NuCypher ICO Value Proposition

A key management system (KMS) is an integrated approach for generating, distributing, and managing cryptographic keys for devices and applications. Current KMS services are centralized and therefore require placing trust in the service provider.

The NuCypher KMS uses a decentralized network, proxy re-encryption for cryptographic access control, and an incentivized token mechanism to eliminate the need for reliance on centralized KMS providers.

NuCypher have set sights on both dApp developers and enterprises for adoption of their product. For developers, NuCypher KMS helps dApp developers secure data on the blockchain via decentralized proxy re-encryption. For enterprises, NuCypher offers additional products to target ERP-specific needs.

The NuCypher ICO team are developing integrations with Hadoop-based databases to store and query encrypted data and Kafka to help enterprise clients shield their data from unauthorized access, share data between organizations, and securely store and process data in the cloud.

NuCypher KMS provides a multitude of use applications for blockchain, IoT and big data applications. Several potential use cases described in the NuCypher white paper are outlined below:

“Decentralized DropBox”: Files can be encrypted client-side and stored with decentralized systems like Swarm and IPFS or centralized systems like S3. The files can be shared with approved third-parties by providing a re-encryption token based on the third-party’s public key. The third-party’s access permission can be easily revoked by removing the re-encryption token from the network.

“Encrypted Slack”: Proxy re-encryption allows for end-to-end encrypted group messaging in cases where multiple participants require read and write access to a channel. Members can be added or removed by issuing or revoking a re-encryption token.

Electronic health records (EHR): Apatient-controlled EHR system can be created in which the patient holds their own data and encryption keys. The data can be stored on a centralized server or in a decentralized fashion. Patients who wish to share encrypted data with a hospital or insurance company issue a re-encryption token, which grants temporary access to the third-party.

Example of Encrypted Data Exchange on NuCypher (from whitepaper)

NKMS is the utility token of NuCypher. The NuCypher network is composed of nodes that provide re-encryption services for users of the service. Nodes are compensated for the services they provide with NKMS, which is paid by the requester of the data encryption service. Nodes are required to stake a certain amount of NKMS to perform re-encryption and are punished for any activity that disrupts the service.

NuCypher ICO Team

MacLane Wilkison (Co-Founder and CEO ): MacLane has experience in both tech and finance. He previously worked at Morgan Stanley as an Investment Banking Analyst in their Media and Communications Group. After his time at Morgan Stanley, he founded NuCypher.

Dr. Michael Egorov (Co-Founder and CTO ): Dr. Egorov holds a Phd in Physics from Swinburne University of Technology. He has spent time working as an engineer in Russia, Australia and the US. He also has 5 years of experience as a Software Engineer. Prior to founding NuCypher, Michael spent nearly 2 years at LinkedIn as a Senior Software Engineer.

Dr. David Núñez (Cryptograpther): Dr. Núñez is an expert in proxy re-encryption. Prior to joining NuCypher full-time, he was a post-doctoral researcher with NICS Labs, an accomplished 20 person security research group at the University of Malaga.

NuCypher ICO Strengths and Opportunities

NuCypher has made their GitHub publicly available. At this stage in their product development, they completed a pre-release alpha MVP. The team consistently update records of their progress and have demonstrated a commitment to making the product development process as transparent as possible.

Nucypher have established a number of partnerships with other blockchain based projects, including Origin Protocol, Mediblock, Wolk and Datum.

On Origin Protocol, NuCypher will act as a privacy layer for the exchange of data such as personal information that users wish remain secure.

In the case of decentralized database provider Wolk and global data marketplace Datum, Nucypher KMS will be leveraged to secure data transfers.

As highly-valuable infrastructure layer for decentralized applications, it’s promising to see a number of partnerships have already been established. In addition, NuCypher have achieved first-mover status as the only visible player in the cryptospace at the moment providing KMS services.

NuCypher ICO Weaknesses and Threats

As for enterprise integration, there is more question in the way of competition for NuCypher. While it makes sense for dApps to leverage a decentralized KMS service for encrypting data, enterprise use remains more of a challenge. A number of enterprise-oriented KMS services exist and are already heavily utilized at the moment, including Amazon CloudHSM, Google Cloud KMS and Azure Key Vault.

While the benefits of adopting a decentralized KMS system may seem obvious because of the risks posed by centralized servers, onboarding a product built on nascent technology by a new player also represents a potential risk. NuCypher’s strategy for convincing their target market otherwise remains unclear at this stage.

While NuCypher have provided a list of product development milestones, they have not released an explicit roadmap outlining their plans for scaling. Further, their list of milestones does not include any dates.

When it comes to business development and marketing of the project, having no metric by which to measure progress could be a detriment.

The Verdict on NuCypher

NuCypher bring to the table an indispensible component of the decentralized economy. The value added to projects by streamlining the use of encryption services is evident from the number of partners already onboard at this early stage.

While the team has yet to provide the community a roadmap or outline of scaling strategies, the level of transparency and progress to date certainly plays to their favor.

In addition to this NuCypher ICO review, we have published Andre Cronje’s code review of the project, and you can read it here.

As a Top 10% rated ICO, we will look to make a small bet on the NuCypher ICO (NKMS Token).

Learn more about the NuCypher ICO (NKMS token) from our Telegram Community by clicking here.

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NuCypher ICO Review Scores

Summary

The NuCypher ICO (NKMS Token) is adding to blockchain technology part of the foundation on which the whole concept of decentralization must rest. Key management systems within the discipline of cryptography are de rigeur and it's almost shocking that they haven't found their way into the cryptocurrency mainstream as a third-party add-on. With the advent of decentralization and the continuing threat elevation against systems and architectures, NuCypher should be well-positioned to exploit first-mover advantage - although its lack of a roadmap for adoption is a major concern.

The NuCypher ICO (NKMS Token) is adding to blockchain technology part of the foundation on which the whole concept of decentralization must rest. Key management systems within the discipline of cryptography are de rigeur and it’s almost shocking that they haven’t found their way into the cryptocurrency mainstream as a third-party add-on. With the advent of decentralization and the continuing threat elevation against systems and architectures, NuCypher should be well-positioned to exploit first-mover advantage – although its lack of a roadmap for adoption is a major concern.

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